Partner relationships broadly breakdown into two types:
- an affiliation that benefits both barties or
- an affiliation that serves a purpose, usually with regard to fulfillment, for both parties
ISVs should appropriately respond to either opportunity.
An Affiliation that benefits both parties
In this scenario an ISV produces products or services, which are promoted, directly, to an end customer by a channel partner. When these scenarios bubble up, ISVs should look to nurture them to capture what will likely amount to a much lower cost of product promotion. Usually this type of partner has a clear understanding of how products or services fit into a larger offer, saving an ISV the time and effort required to build a compelling case for target customers to implement products or services. The tacit recommendation represented by the partner’s effort produces a higher level of positive momentum for the prospect. The result is a shorter sales cycle for this type of opportunity.
An Affiliation that Serves a Purpose, Usually with Regard to Fulfillment, for Both Parties
When an end customer is required by procurement policy to go out to bid on any/all technology purchases, an ISV needs to work with whomever lands an order. Under no circumstances does it make sense to try to impede this process. The best way to look at an order of this type is that, without the partner who landed the order, there would be no sale to the end customer. It makes sense to have a pricing policy in place prior to contending for this type of business. This type of partner rarely expects a substantial margin. ISVs should be careful not to extend one.
Sales personnel at ISVs should have experience working with channel partners. Inexperienced personnel can make costly mistakes with either type of partner. Where management is not clear as to how to handle partners it makes sense to proceed very slowly on these opportunities. Better to be guilty of taking forever to finalize a sale, than to inadvertently make an obstacle out of a firm that can otherwise be a productive partner.
© IMB Enterprises, Inc. & Ira Michael Blonder, 2013 All Rights Reserved